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Business News: Enterprising sale boosts Admiral
Enterprise inns has sold a tenth of its estate to Admiral Taverns in a bid to improve the quality of its portfolio.
The UK’s second-largest pub operator has agreed to sell 769 pubs across England and Wales to the rival pub operator for a total of £318.1 million. The pubs – nearly a quarter of which are located in London and the Southeast of England – had failed to meet Enterprise Inns’ quality target.
The move will not come as a surprise to market observers. Enterprise Inns announced that it would dispose of approximately 800 pubs in the course of the next five years when it reported its final results last November. Following completion of the deal, Enterprise Inns will have 7,700 pubs remaining within its estate.
The financing package was made up of £316.6m in cash and £1.5m in preference shares. The group is expected to use the proceeds of the sale to repay debt.
The sale has made Admiral Taverns the third-largest owner and tenanted pub operator in the UK, after Punch Taverns and Enterprise Inns. Admiral Taverns, which is owned by the Landesberg and Rosenberg families, now has 1,825 pubs in its portfolio. The deal, Admiral Taverns’ largest to date, is scheduled to complete in September.
© db September 2006